What I see in the Market for Small Businesses - Buy a Business - Sell a Business

You see for
a ‘market’ to exist, you need many buyers, sellers and a product or
commodity. For example, there is a
market for 4-door used cars and a market for 3-bedroom homes in each town and
city, but small businesses are very individual.
They’re unique.

Therefore,
they each have their own market!

In the video
I give an example of the process engineer who will never buy the highly
profitable flower shop. I used to see it
all the time when I owned my business brokerage.

As far as
pricing goes, it doesn’t change much over time except if certain industries are
perceived to be more or less risky.
Business are valued on their cash flow and what the buyer is willing to
pay is based on their perception of the risk that the cash will continue to
flow into the future.

There is one
exception though. It’s an old story
about market manipulation.

Anywhere
someone with limited English can run a simple business and quickly learn enough
words to make change and serve customers.

I recently
worked on a case where a newcomer was willing to overpay by 40%... because he
was up against a time-limit and if he didn’t buy a business he would lose a
$75,000 deposit that he had made to get into the country.

Welcome to
Canada, let us into your wallet. I bet
he feels all warm and fuzzy about igloos, beavers and maple syrup.

Just like in
any market where politicians and civil servants decide to meddle, an artificial
urgency has been created and business sellers are taking full advantage of
these victims created by government policy.

If you’d like to learn how to create high returns by making
local private lending and lease deals, check out http://www.LocalInvestingCourse.com
The Local Investing Academy starts in September. For a quick introduction, read Invest
Local. It’s available from Amazon stores
worldwide or as a .pdf here: https://gum.co/quoB

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